Role of individual entrepreneurial orientation and innovation in SME performance: Gender perspectives
-
DOIhttp://dx.doi.org/10.21511/ppm.22(2).2024.28
-
Article InfoVolume 22 2024, Issue #2, pp. 365-378
- Cited by
- 337 Views
-
71 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
Individual entrepreneurial orientation and innovation are essentials for small and medium enterprises (SMEs) to drive their performance, including surviving or even growing during economic crises. The entrepreneur’s gender might have an impact on those relationships. Hence, this study aims to analyze whether there were some differences in the five dimensions of individual entrepreneurial orientation and differences in the influence of individual entrepreneurial orientation and innovation on performance between male and female entrepreneurs. The study was performed through an online survey of 352 SME owners in Indonesia. Structural equation modeling (SEM) and multi-group analysis were conducted to test the hypotheses. The results demonstrated that all dimensions of individual entrepreneurial orientation are valid for developing this construct, but only the risk-taking dimension distinguishes male and female entrepreneurs the most. Male entrepreneurs are more willing to take risks than female. Furthermore, individual entrepreneurial orientation affects performance mediated by innovation, and this effect is not different between male and female entrepreneurs. These findings enrich the literature on the impact of gender on entrepreneurial orientation and the influence of innovation on SME performance. In Indonesia, individual entrepreneurial orientation affects performance assisted by innovation; however, this influence is not different for SMEs managed by male and female entrepreneurs.
Acknowledgment
We acknowledge and thank all of the respondents and parties who supported this research. This study was funded by the Directorate of Research and Community Engagement, Universitas Indonesia, contract number NKB-1782/UN2.RST/HKP.05.00/2020.
- Keywords
-
JEL Classification (Paper profile tab)L26, M10, M50, O15
-
References68
-
Tables8
-
Figures1
-
- Figure 1. Conceptual model
-
- Table 1. General sample information
- Table 2. Reliability and convergent validity
- Table 3. Discriminant validity
- Table 4. Analysis of the individual entrepreneurial orientation as the second-order construct
- Table 5. Descriptive mean difference t-test
- Table 6. Path coefficients
- Table 7. Multi-group analysis (male vs. female)
- Table A1. Measurement items
-
- Abu-Rumman, A., Al Shraah, A., Al-Madi, F., & Alfalah, T. (2021). Entrepreneurial networks, entrepreneurial orientation, and performance of small and medium enterprises: Are dynamic capabilities the missing link? Journal of Innovation and Entrepreneurship, 10.
- Al-Hakimi, M. A., Saleh, M. H., & Borade, D. B. (2021). Entrepreneurial orientation and supply chain resilience of manufacturing SMEs in Yemen: The mediating effects of absorptive capacity and innovation. Heliyon, 7(10), Article e08145.
- Ali, G. A., Hilman, H., & Gorondutse, A. H. (2020). Effect of entrepreneurial orientation, marketing orientation, and total quality management on performance: Evidence from Saudi SMEs. Benchmarking: An International Journal, 27(4), 1503-1531.
- Alvi, F. H. (2021). International entrepreneurial orientation amidst post-colonial upheaval: Entrepreneurs during the Hong Kong umbrella revolution. Critical Perspectives on International Business, 17(4), 572-598.
- Ayub, A., Razzaq, A., Aslam, M. S., & Iftekhar, H. (2013). Gender effects on entrepreneurial orientation and value innovation: Evidence from Pakistan. European Journal of Business and Social Sciences, 2(1), 82-90.
- Barber, D. III, Peake, W. O., & Harris, M. L. (2024). Can playing defense yield gains? Examining the relationships among regulatory focus, innovation, and SME performance. Journal of Small Business Management, 62(3), 1469-1497.
- Basco, R., Hernandez-Perlines, F., & Rodriguez-Garcia, M. (2020). The effect of entrepreneurial orientation on firm performance: A multi-group analysis comparing China, Mexico, and Spain. Journal of Business Research, 113, 409-421.
- Batjargal, B., Webb, J. W., Tsui, A., Arregle, J. L, Hitt, M. A., & Miller, T. (2019). The moderating influence of national culture of female and male entrepreneurs’ social network size and venture growth. Cross Cultural & Strategic Management, 26(4), 490-521.
- Baum, J. R., & Locke, E. A. (2004). The relationship of entrepreneurial traits, skill, and motivation to subsequent venture growth. Journal of Applied Psychology, 89(4), 587-598.
- Bolton, D. L., & Lane, M. D. (2012). Individual entrepreneurial orientation: Development of a measurement instrument. Education + Training, 54(2/3), 219-233.
- Butkouskaya, V., Llonch-Andreu, J., & Alarcon-del-Amo, M. D. C. (2020). Entrepreneurial orientation (EO), integrated marketing communications (IMC), and performance in small and medium sized enterprises (SMEs): Gender gap and inter-country context. Sustainability, 12(17), Article 7159.
- Cesaroni, M. F., Sentuti, A., & Buratti, A. (2015). Same crisis, different strategies? Italian men and women entrepreneurs in front of the economic recession. Journal of Research in Gender Studies, 5(2), 205-231.
- Chatterjee, C., & Ramu, S. (2018). Gender and its rising role in modern Indian innovation and entrepreneurship. IIMB Management Review, 30(1), 62-72.
- Chege, S. M., & Wang, D. (2020). The influence of technology innovation on SME performance through environmental sustainability practices in Kenya. Technology in Society, 60, Article 101210.
- Covin, J. G., & Miller, D. (2014). International entrepreneurial orientation: Conceptual considerations, research themes, measurement issues, and future research directions. Entrepreneurship Theory and Practice, 38(1), 11-44.
- Covin, J. G., & Slevin, D. P. (1989). Strategic management of small firms in hostile and benign environments. Strategic Management Journal, 10(1), 75-87.
- Covin, J. G., Rigtering, J. P. C., Hughes, M., Kraus, S., Cheng, C. F., & Bouncken, R. B. (2020). Individual and team entrepreneurial orientation: Scale development and configurations for success. Journal of Business Research, 112, 1-12.
- Dess, G. G., & Robinson, R. B. Jr. (1984). Measuring organizational performance in the absence of objective measures: The case of the privately-held firm and conglomerate business unit. Strategic Management Journal, 5(3), 265-273.
- Dwumah, P., Amaniampong, E.M., Kissiedu, J.A., & Boahen, E. A. (2024). Association between entrepreneurial orientation and the performance of small and medium enterprises in Ghana: The role of network ties. Cogent Business & Management, 11(1), Article 2302192.
- Eggers, F. (2020). Masters of disasters? Challenges and opportunities for SMEs in times of crisis. Journal of Business Research, 116, 199-208.
- El Caarani, H., Vrontis, D., El Nemar, S., & El Abiad, Z. (2022). The impact of strategic competitive innovation on the financial performance of SMEs during COVID-19 pandemic period. Competitiveness Review: An International Business Journal, 32(3), 282-301.
- Exposito, A., Sanchis-Llopis, A., & Sanchis-Llopis, J. (2023). Entrepreneur’s gender and SMEs performance: The mediating effect of innovations. Journal of the Knowledge Economy.
- Fajar, T. (2019). 14 juta usaha di Indonesia dikelola wanita [14 million businesses in Indonesia are managed by women]. Okezone. (In Indonesian).
- Fang, G. G., Qalati, S. A., Ostic, D., Shah, S. M. M., & Mirani, M. A. (2022). Effects of entrepreneurial orientation, social media, and innovation capabilities on SME performance in emerging countries: A mediated–moderated model. Technology Analysis & Strategic Management, 34(11), 1326-1338.
- Fellnhofer, K., Puumalainen, K., & Sjögrén, H. (2016). Entrepreneurial orientation and performance – Are sexes equal? International Journal of Entrepreneurial Behavior & Research, 22(3), 346-374.
- Ferreira, J. J. M., Fernandes, C. I., & Ratten, V. (2016). A co-citation bibliometric analysis of strategic management research. Scientometrics, 109(1), 1-32.
- Fillaili, R., Kusumawardhani, N., Larasati, W., Sawiji, H. W., Anshary, F., Gemilang, M. S. C., Putri, R. D., & Pertiwi, U. M. (2022). Men and women owned/led MSMEs and the COVID-19 policy responses in Indonesia. SMERU Research Institute.
- Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18(1), 39-50.
- Gerschewski, S., Lindsay, V. J., & Rose, E. (2016). Advancing the entrepreneurial orientation construct: The role of passion and perseverance. Review of International Business and Strategy, 26(4), 446-471.
- Goktan, A. B., & Gupta, V. K. (2015). Sex, gender, and individual entrepreneurial orientation: Evidence from four countries. The International Entrepreneurship and Management Journal, 11(1), 95-112.
- Gosta, D. R. (2017, March 10). Ini empat kendala utama perempuan pengusaha di Indonesia [These are the four main obstacles for women entrepreneurs in Indonesia]. Bisnis. (In Indonesian).
- Gunjati, S. B., & Adake, C. V. (2020). Innovation in Indian SMEs and their current viability: A review. Material Today: Proceedings, 28, 2325-2330.
- Hair, J. F. Jr, Black, W. C., Babin, B. J., & Anderson, R.E. (2014). Multivariate data analysis (7th ed.). Harlow: Pearson Education.
- Hair, J. F. Jr., Hult, G. T. M., Ringle, C. M., & Sasstedt, M. (2017). A primer on partial least squares structural equation modelling. Thousand Oaks: Sage.
- Hmieleski, K. M., & Sheppard, L. D. (2019). The Yin and Yang of entrepreneurship: Gender differences in the importance of communal and agentic characteristics for entrepreneurs’ subjective well-being and performance. Journal of Business Venturing, 34(4), 709-730.
- Idris, A. (2008). A profile of innovative women entrepreneurs. International Business Research, 1(2), 3-10.
- Ince, H., Imamoglu, S. Z., & Karakose, M. A. (2023). Entrepreneurial orientation, social capital, and firm performance: The mediating role of innovation performance. The International Journal of Entrepreneurship and Innovation, 24(1), 32-43.
- Indonesia Central Bureau of Statistics. (2024). Sumbangan Pendapatan Perempuan (Persen) 2022–2023 [Women’s income contribution (percent) 2022–2023). (In Indonesian).
- Isichei, E. E., Agbaeze, K. E., & Odiba, M. O. (2020). Entrepreneurial orientation and performance in SMEs. The mediating role of structural infrastructure capability. International Journal of Emerging Markets, 15(6), 1219-1241.
- Kottika, E., Özsomer, A., Rydén, P., Theodorakis, J. G., Kaminakis, K., Kottikas, K. G., & Stathakopoulos, V. (2020). We survive this! What managers could learn from SMEs who successfully navigated the Greek economic crisis. Industrial Marketing Management, 88, 352-365.
- Kreiser, P. M., Marino, L. D., Kuratko, D. F., & Weaver, K. M. (2013). Disaggregating entrepreneurial orientation: The non-linear impact of innovativeness, proactiveness, and risk-taking on SME performance. Small Business Economics, 40(2), 273-291.
- Kumar, S., Paray, Z. A., & Dwivedi, A. K. (2021). Students’ entrepreneurial orientation and intentions. A study across gender, academic background, and regions. Higher Education, Skills and Work-Based Learning, 11(1), 78-91.
- Ladd, T., Hind, P., & Lawrence, J. (2019). Entrepreneurial orientation, Waynesian self-efficacy for searching and marshaling, and intention across gender and region of origin. Journal of Small Business & Entrepreneurship, 31(5), 391-411.
- Lee, S. M., & Peterson, S. J. (2000). Culture, entrepreneurial orientation, and global competitiveness. Journal of World Business, 35(4), 401-416.
- Li, Y. H., Huang, J. W., & Tsai, M. T. (2009). Entrepreneurial orientation and firm performance: The role of knowledge creation process. Industrial Marketing Management, 38(4), 440-449.
- Lim, S., & Envick, B. R. (2013). Gender and entrepreneurial orientation: A multi-country study. International Entrepreneurship and Management Journal, 9, 465-482.
- Ljunggreen, E., Alsos, G. A., Amble, N., Ervik, R., Kvidal, T., & Wiik, R. (2010). Gender and innovation: Learning from regional VRI-projects (NF-rapport nr. 2/2010). Nordland Research Institute.
- Majali, T., Alkaraki, M., Asad, M., Aladwan, N., & Aledeinat, M. (2022). Green transformational leadership, green entrepreneurial orientation and performance of SMEs: The mediating role of green product innovation. Journal of Open Innovation: Technology, Market, and Complexity, 8(4).
- Markman, G.D., Baron, R.A., & Balkin, D.B. (2005). Are perseverance and self-efficacy costless? Assessing entrepreneurs’ regretful thinking. Journal of Organizational Behavior, 26(1), 1-19.
- Mastercard Index of Women Entrepreneurs. (2020). The Mastercard Index of Women Entrepreneurs 2020 Report.
- Meutia, M., Ismail, T., & Ummi, N. (2018). Leadership issue and SME performance during crisis. International Journal of Civil Engineering and Technology, 9(4), 424-435.
- Miller, D. (1983). The correlates of entrepreneurship in three types of firms. Management Science, 29(7), 770-791.
- Morgan, N. A., Slotegraaf, R. J., & Vorhies, D. W. (2009). Linking marketing capabilities with profit growth. International Journal of Research in Marketing, 26(4), 284-293.
- Morris, M. H., & Lewis, P. S. (1995). The determinants of entrepreneurial activity implications for marketing. European Journal of Marketing, 29(7), 31-48.
- Moudry, D. V., & Thaichon, P. (2020). Enrichment for retail businesses: How female entrepreneurs and masculine traits enhance business success. Journal of Retailing and Consumer Services, 54, Article 102068.
- Neneh, B. N., Van Zyl, J. H., & Van Noordwyk, A. (2016). Gender differences in entrepreneurial orientation and performance: Evidence from South Africa. Proceedings of the 28th Annual Conference of the Southern African Institute of Management Scientists.
- Oduro, S. (2022). Entrepreneurial orientation and innovation performance of social enterprises in an emerging economy. Journal of Research in Marketing and Entrepreneurship, 24(2), 312-336.
- Putniņš, T. J., & Sauka, A. (2020). Why does entrepreneurial orientation affect company performance? Strategic Entrepreneurship Journal, 14(4), 711-735.
- Rachmawati, E., Suliyanto, & Suroso, A. (2022). Direct and indirect effect of entrepreneurial orientation, family involvement and gender on family business performance. Journal of Family Business Management, 12(2), 214-236.
- Santos, G., Marques, C. S., & Ferreira, J. J. M. (2020). Passion and perseverance as two new dimensions of an individual entrepreneurial orientation scale. Journal of Business Research, 112, 190-199.
- Sawaean, F. A. A., & Ali, K. A. M. (2020). The impact of entrepreneurial leadership and learning orientation on organizational performance of SMEs: The mediating role of innovation capacity. Management Science Letters, 10, 369-380.
- Soininen, J., Puumalainen, K., Sjogren, H., & Syrjä, P. (2012). The impact of global economic crisis on SMEs – Does entrepreneurial orientation matter? Management Research Review, 35(10), 927-944.
- Sok, P., O’Cass, A., & Sok, K. M. (2013). Achieving superior SME performance: Overarching role of marketing, innovation, and learning capabilities. Australasian Marketing Journal, 21, 161-167.
- Thébaud, S. (2015). Status beliefs and the spirit of capitalism: Accounting for gender biases in entrepreneurship and innovation. Social Forces, 94(1), 61-86.
- Wang, J., Li, Y., & Long, D. (2019). Gender gap in entrepreneurial growth ambition: The role of culturally contingent perceptions of the institutional environment in China. International Journal of Entrepreneurial Behavior & Research, 25(6), 1283-1307.
- Widyaningrum, N. (2020, August 3). UMKM Indonesia tahan banting pada krisis 1998 dan 2008, tapi tidak saat pandemic [Indonesian MSMEs were resilient during the 1998 and 2008 crisis, but not during the pandemic]. The Conversation. (In Indonesian).
- Wiklund, J., Patzelt, H., & Shepherd, D. A. (2009). Building an integrative model of small business growth. Small Business Economics, 32(4), 351-374.
- Zimmerman, M. A., & Brouthers, K. D. (2012). Gender heterogeneity, entrepreneurial orientation and international diversification. International Journal of Gender and Entrepreneurship, 4(1), 20-43.